What will a good estate plan do for you and your family?

It will protect you and defend against:

  1. unnecessary probate court costs and fees,
  2. acceleration or avoidance of income taxes – in the form of maximum deferral of taxes on retirement assets or in maximizing the step up in basis at death,
  3. loss of assets to federal estate taxes,
  4. loss of assets from lawsuits (legal claims and divorces),
  5. loss of assets from wasteful spending, and
  6. from loss by controlling the ultimate distribution of assets so they stay in your blood family.

Perhaps the greatest benefit of a good estate plan is the peace of mind you will have knowing that you have put these affairs in order.

If you want the protection a good estate plan will give you, it must be done before you need it. If you have moved from another state, your legal documents should be reviewed and probably updated.

At our office, we usually meet with clients three to four times during a representation. The first meeting is complimentary. The second meeting is to review a draft of the papers. The second meeting is followed with a telephone conference. The final meeting is to get the papers signed.

Let’s say Bryan and Clarabelle have a son named Ethan who is married to Sue. Ethan and Sue have a daughter named Evelyn who gets government benefits due to her disability.

Bryan and Clarabelle want to make sure Sue will not get their assets. The solution is to leave their assets in a trust for Ethan’s benefit, with the remainder to Evelyn.

Doing this will guarantee that Bryan and Clarabelle’s assets will not get lost in a divorce if Ethan divorces Sue, and, when Ethan passes, the assets he inherited from Bryan and Clarabelle will go to Evelyn and not Sue.

Bryan and Clarabelle can make sure that when Evelyn inherits what is left over, she inherits in a special needs trust so she will not lose her government benefits.

If not planned for in advance, Ethan could inherit the assets and lose them to Sue in a divorce or other lawsuit. On Ethan’s death, Sue could get half, if not all, of those assets.

In addition, whatever Evelyn inherits could jeopardize her government benefits.

The bottom line is that if you want to keep your assets in your family, and you want the peace of mind that comes from it, you must plan in advance.

You will get peace of mind and your family will thank you for it.

Remember, a little bit of planning can make a big difference.

Mark F. Winn, J.D., Master of Laws (LL.M.) in estate planning, is a local asset protection, estate planning and elder law attorney. www.mwinnesq.com